--- title: What Is Margin Used per Trade Idea? description: "Margin used per trade idea refers to the total margin required to open and maintain all positions that belong to the same trade idea.\n\nA trade idea includes:\n\nA single instrument (e.g. only Gold), or\nA group of correlated instruments (e.g. EUR/USD + GBP/USD)\n\nAll related positions are aggregated and treated as one trade idea, even if they are:\n\nOpened at different times\nSplit into multiple entries\nUsing different lot sizes\n\nSplitting trades does not reduce margin usage.\n\n\n\n\nWhat Is the Margin Limit?\n\nAt The Trading Pit, margin usage per trade idea is limited to:\n\nMaximum: 40% of your initial account balance\n\nThis rule exists to prevent excessive exposure and protect traders from catastrophic losses.\n\nYou can find the affected trades in your trading dashboard under the Trade List tab.\n\nWhat Actions Do We Take?\n\nMargin usage is monitored in real time:\n\nReminder\nSent when margin usage reaches 30% per trade idea\nFirst violation\nFirst warning + forced position closure\nSecond violation\nAccount breach\n\n\n\nIMPORTANT NOTE:\n\nThe automation of the rules regarding risk per trade idea and margin used per trade idea will be removed for accounts up to and including 50K. These rules will continue to apply, as they do for all CFD Prime accounts, both Challenge and Earning accounts. The only difference is that, for accounts up to and including 50K, these rules will now be monitored manually by our Risk Team. \n\n\n\n\nExample – Single Instrument (Gold)\n\nA trader opens:\n\nBuy 0.5 lots XAUUSD\nBuy 0.3 lots XAUUSD\nBuy 0.2 lots XAUUSD\n\nAll positions are combined and treated as one trade idea.\nThe total margin of all Gold positions must remain below 40% of the initial account balance.\n\nExample – Correlated Instruments\n\nA trader believes the USD will weaken and opens:\n\nBuy EUR/USD\nBuy GBP/USD\nSell USD/CHF\n\nThese trades are correlated and treated as one trade idea.\nCombined margin across all positions must stay below 40%.\n\n\n\n\nMargin Used Formula (Using Leverage)\n\nMargin Used Per Trade Idea Formula = (Lots × Contract Size × Price) / Leverage\n\n\n\nExample – Margin Used per Trade Idea (Correlated FX Instruments)\n\nScenario\n\nA trader believes the US dollar will weaken and opens positions across multiple USD-related pairs.\nAlthough different instruments are used, they are correlated and therefore treated as one trade idea.\n\n\n\n\nAccount & Risk Limits\n\nAccount balance: $10,000\nMargin limit per trade idea: 40% → $4,000\nReminder level: 30% → $3,000\n\n\n\n\nInstrument Specifications\n\nFor simplicity, all pairs have:\n\nLeverage: 1:50\nContract size: 100,000\n\nPair\n\n \n\nMarket Price\n\n\n\n\nEUR/USD\n\n \n\n1.1000\n\n\n\n\nGBP/USD\n\n \n\n1.2500\n\n\n\n\nStep 1 – Margin per Trade\n\nEUR/USD – 0.7 lot\n\nGBP/USD – 0.5 lot\n\n\n\n\nStep 2 – Combined Margin (One Trade Idea)\n\nInstrument\n\n \n\nLots\n\n \n\nMargin Used\n\n\n\n\nEUR/USD\n\n \n\n0.7\n\n \n\n$1,540\n\n\n\n\nGBP/USD\n\n \n\n0.5\n\n \n\n$1,250\n\n\n\n\nTotal\n\n \n\n1.2\n\n \n\n$2,790\n\nBoth trades express the same USD-weakness idea\nThey are aggregated into one trade idea\n\n\n\n\nStep 3 – Rule Evaluation\n\nReminder level (30%): $3,000\nCurrent margin usage: $2,790 (27.9%)\n\nWithin limits — no action taken\n\n\n\n\nStep 4 – Warning Scenario\n\nThe trader adds 0.3 lot EUR/USD:\n\nNew total margin:\n$2,790 + $660 = $3,450 (34.5%)\n\nFirst reminder issued (exceeded 30%)\n\n\n\n\nStep 5 – Violation Scenario\n\nThe trader adds 0.3 lot GBP/USD:\n\nNew total margin:\n$3,450 + $750 = $4,200 (42%)\n\nFirst violation\nAutomatic warning + position closure\n\nIf the trader repeats this behavior again:\nSecond violation → account breach\n\n\n\n\nWhy This Rule Exists\n\nUsing a large portion of your account on one idea is not risk management — it’s gambling.\n\nHigh margin concentration leads to:\n\nFast and painful losses\nEmotional decision-making\nStrategy breakdown\n\nProfessional trading is built on discipline, consistency and survival." --- [Skip to content](https://support.thetradingpit.com/what-is-margin-used-per-trade-idea#main-content) - 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[TheTradingPit Help Center](https://support.thetradingpit.com/?hsLang=en) 2. [Trading Rules](https://support.thetradingpit.com/trading-rules?hsLang=en) 3. [CFD Prime](https://support.thetradingpit.com/trading-rules?hsLang=en#cfd-prime) # What Is Margin Used per Trade Idea?   **Please note:** The information below applies to the following accounts where the Margin Used per Trade Idea rule remains in effect: For CFDs Prime 1 Phase and 2 Phase $5K, $10K, $20K, $50K, and CFDs Prime 2 Phase $100K accounts, this applies to accounts created before 29.05.2026. For CFDs Prime 1 Phase $100K and $200K accounts, this applies to accounts created before 06.07.2026. Margin used per trade idea refers to the total margin required to open and maintain all positions that belong to the same trade idea. A trade idea includes: - A single instrument (e.g. only Gold), or - A group of correlated instruments (e.g. EUR/USD + GBP/USD) All related positions are aggregated and treated as one trade idea, even if they are: - Opened at different times - Split into multiple entries - Using different lot sizes Splitting trades does not reduce margin usage.   **What Is the Margin Limit?** At The Trading Pit, margin usage per trade idea is limited to: **Maximum: 40% of your initial account balance** This rule exists to prevent excessive exposure and protect traders from catastrophic losses. You can find the affected trades in your trading dashboard under the **Trade List** tab. **What Actions Do We Take?** Margin usage is monitored in real time: - **Reminder** Sent when margin usage reaches **30% per trade idea** - **First violation** First warning + forced position closure - **Second violation** Account breach **IMPORTANT NOTE:** The automation of the rules regarding risk per trade idea and margin used per trade idea will be removed for accounts up to and including 50K. These rules will continue to apply, as they do for all CFD Prime accounts, both Challenge and Earning accounts. The only difference is that, for accounts up to and including 50K, these rules will now be monitored manually by our Risk Team.    **Example – Single Instrument (Gold)** A trader opens: - Buy 0.5 lots XAUUSD - Buy 0.3 lots XAUUSD - Buy 0.2 lots XAUUSD All positions are combined and treated as one trade idea. The total margin of all Gold positions must remain below **40% of the initial account balance**. **Example – Correlated Instruments** A trader believes the USD will weaken and opens: - Buy EUR/USD - Buy GBP/USD - Sell USD/CHF These trades are correlated and treated as one trade idea. Combined margin across all positions must stay below **40%**.   **Margin Used Formula (Using Leverage)** Margin Used Per Trade Idea Formula = (Lots × Contract Size × Price) / Leverage **Example – Margin Used per Trade Idea (Correlated FX Instruments)** **Scenario** A trader believes the US dollar will weaken and opens positions across multiple USD-related pairs. Although different instruments are used, they are correlated and therefore treated as one trade idea.   **Account & Risk Limits** - Account balance: **$10,000** - Margin limit per trade idea: **40% → $4,000** - Reminder level: **30% → $3,000**   **Instrument Specifications** For simplicity, all pairs have: - Leverage: **1:50** - Contract size: **100,000** | **Pair** | **Market Price** | | --- | --- | | EUR/USD | 1.1000 | | GBP/USD | 1.2500 |   **Step 1 – Margin per Trade** **EUR/USD – 0.7 lot** **GBP/USD – 0.5 lot**   **Step 2 – Combined Margin (One Trade Idea)** | **Instrument** | **Lots** | **Margin Used** | | --- | --- | --- | | EUR/USD | 0.7 | $1,540 | | GBP/USD | 0.5 | $1,250 | | **Total** | **1.2** | **$2,790** | Both trades express the same USD-weakness idea They are aggregated into one trade idea   **Step 3 – Rule Evaluation** - Reminder level (30%): **$3,000** - Current margin usage: **$2,790 (27.9%)** Within limits — no action taken   **Step 4 – Warning Scenario** The trader adds **0.3 lot EUR/USD**: New total margin: **$2,790 + $660 = $3,450 (34.5%)** First reminder issued (exceeded 30%)   **Step 5 – Violation Scenario** The trader adds **0.3 lot GBP/USD**: New total margin: **$3,450 + $750 = $4,200 (42%)** First violation Automatic warning + position closure If the trader repeats this behavior again: **Second violation → account breach**   **Why This Rule Exists** Using a large portion of your account on one idea is not risk management — it’s gambling. 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